16 July 2018

Background

The defendant local authority (LCC) passed a resolution, in so far as legal considerations allowed, to boycott any produce originating from illegal Israeli settlements in the West Bank until such time as it complied with international law and withdrew from Palestinian occupied territories. The Divisional Court dismissed the claimants’ application for judicial review, seeking to quash the resolution. It held that, in passing the resolution, LCC did not breach its obligations in respect of the public sector equality duty (PSED) set out in s 149 of the Equality Act 2010. The claimant appealed.  

Appeal dismissed.

Issues and decisions

Whether LCC had had due regard to the need to eliminate discrimination, harassment and victimisation, and to the need to foster good relations between persons who shared a relevant protected characteristic (being Jewish or practising the Jewish religion) and persons who did not share it.

LCC’s submission that ‘due regard’, as that expression was used in s 149(1), could mean that, in some contexts, it was permissible to have no regard to the matters set out in that provision, would not be accepted. Given the enormous range of functions to which the PSED applied, it might be justified, in some contexts, for a decision-maker not to advert to the matters in s 149(1) if, at the time of acting, they appeared to have nothing to do with the action in question or if it appeared positively that they could have no bearing on the decision under consideration. However, in the present context, councillors had been rightly well aware that adoption of the resolution might have an impact on community relations, so they had not been entitled to leave the PSED out of account and give no regard to the matters set out in s 149(1) (see [31], [32], [44], [45] of the judgment).

The evidence showed that LCC, acting by its assembly of councillors, had complied with the PSED by having due regard to the need to eliminate discrimination, harassment and victimisation, and to the need to foster good relations between the Jewish community and others (see [35], [44], [45] of the judgment).

The terms of the proposed resolution had been such that it was clear that the councillors had had due regard to the matters set out in s 149(1). The resolution had referred, in substance, to the need to eliminate discrimination, harassment and victimisation in relation to any community, and to the need to foster good relations between persons from different faith and ethnic groups. Councillors voting on the resolution had clearly had regard to those matters. That had been due regard in the circumstances. The terms in which the debate had been conducted reinforced those points (see [39], [40], [42], [44], [45] of the judgment).

R (on the application of Baker) v Secretary of State for Communities and Local Government [2008] All ER (D) 412 (Feb) applied; Hotak v Southwark London Borough Council; Kanu v Southwark London Borough Council; Johnson v Solihull Metropolitan Borough Council [2015] 3 All ER 1053 applied; Hazell v Hammersmith and Fulham London Borough Council [1991] 1 All ER 545 considered.

Decision of Divisional Court  [2017] 3 All ER 505 affirmed.

Robert Palmer (instructed by RHF Solicitors) for the claimant.

Andrew Sharland QC and Zac Sammour (instructed by Leicester City Council) for LCC.

Karina Weller - Solicitor (NSW) (non-practising).

The defendant local authority had complied with the public sector equality duty in s 149 of the Equality Act 2010, by having due regard to the need to eliminate discrimination, harassment and victimisation, and to the need to foster good relations between the Jewish community and others. Accordingly, the Court of Appeal, Civil Division, dismissed the claimant’s appeal against the decision upholding the authority’s resolution to boycott any produce originating from illegal Israeli settlements in the West Bank until such time as it complied with international law and withdrew from Palestinian occupied territories.

Background

The two appellants were charged with offences of entering into funding arrangements connected with terrorism, contrary to s 17 of the Terrorism Act 2000 (TA 2000). The particulars of the offences were that the appellants had been charged with sending money overseas, or arranging to do so, when they knew or had reasonable cause to suspect that it would, or might, be used for the purposes of terrorism.

At a preparatory hearing, a question arose concerning the correct meaning of the expression ‘has reasonable cause to suspect’ in the TA 2000 s 17(b). The alternatives considered were that: (i) the accused actually had to suspect, and for reasonable cause, that the money might be used for the purposes of terrorism; or (ii) on the information known to the accused, there existed, assessed objectively, reasonable cause to suspect that that might be the use to which it was put. Both the judge and the Court of Appeal, Criminal Division concluded that the latter interpretation was to be preferred. The appellants appealed, arguing among other things that the words were capable of either meaning, and that a well established presumption operated to accord to the section the meaning that an accused actually had to suspect that the money might be put to terrorist use.

Appeal dismissed.

Issues and decisions

Whether TA 2000 s 17(b) should be construed so that the accused had actually to suspect that the money might be used for the purposes of terrorism.

The importance of the presumption - that an offence-creating provision ought to be construed as requiring an element of a guilty mind (mens rea) - lay in ensuring that a need for mens rea was not inadvertently, silently, or ambiguously removed from the ingredients of a statutory offence. It was not a power in the court to substitute for the plain words used by Parliament a different provision, on the grounds that it would, if itself drafting the definition of the offence, have done so differently by providing for an element, or a greater element, of mens rea (see [9] of the judgment).

Accordingly, the presumption was a principle of statutory construction, which had to give way to either the plain meaning of the words, or to other relevant pointers to meaning which clearly demonstrated what had been intended. It followed that the Court of Appeal in the present case, had not fallen into error by starting with the words of the TA 2000, as opposed to beginning with the presumption of mens rea and whether that presumption had been displaced by the words of the section (see [7], [12] of the judgment).

The words of TA 2000 s 17(b) at first sight, suggested an objective test. It was difficult to see the statutory provision as one which was silent as to the state of mind required for the commission of the offence (see [13] of the judgment).

There was no universal proposition in current law that if a statute spoke of a person having ‘reasonable cause to suspect’, that would always assume that he had to have actual suspicion (see [17] of the judgment).

Having regard to the offence of providing funding towards terrorism in the statutory context, the change in the statutes from ‘knows or suspects’ to ‘knows or has reasonable cause to suspect’ could only have been intended to remove the requirement for proof of actual suspicion. It was not open to the court to ignore that kind of clear parliamentary decision (see [18], [19] of the judgment).

It would be an error to suppose that the form of offence-creating words adopted by Parliament had resulted in an offence of strict liability. The accused’s state of mind was not irrelevant. The requirement that there exist objectively assessed cause for suspicion focused attention on what information the accused had had. That requirement was satisfied when, on the information available to the accused a reasonable person would (not might or could) suspect that the money might be used for terrorism. The state of mind of such a person was, whilst clearly less culpable than that of a person who knew that the money might be used for that purpose, not accurately described as in no way blameworthy. The difference in culpability could, absent other aggravating features of the case, be expected to be reflected in any sentence imposed if conviction resulted (see [24] of the judgment).

Accordingly, it was clear that the conclusions arrived at by the trial judge and the Court of Appeal had been correct (see [25] of the judgment).

O’Hara v Chief Constable of Royal Ulster Constabulary [1997] 1 All ER 129 distinguished; R v Saik [2006] 4 All ER 866 distinguished; Sweet v Parsley [1969] 1 All ER 347 considered; R v Hughes [2013] 4 All ER 613 considered; R v Brown (Northern Ireland) [2013] 4 All ER 860 considered; R v Taylor [2016] 4 All ER 617 considered.

Decision of Court of Appeal, Criminal Division [2017] EWCA Crim 129 Affirmed.

Tim Moloney QC and Richard Thomas (instructed by ITN Solicitors) for the appellants.

Louis Mably QC and Alison Morgan (instructed by the Crown Prosecution Service) for the Crown.

Paul Mclachlan Barrister.

The trial judge and the Court of Appeal, Criminal Division had not erred in holding that the correct meaning of ‘has reasonable cause to suspect’, in s 17(b) of the Terrorism Act 2000, was that it was sufficient that, on the information known to the accused, there had existed, assessed objectively, reasonable cause to suspect that the money might be used for the purposes of terrorism. Accordingly, the Supreme Court dismissed the appellants’ appeal.

Background

The respondent, B, was a national of South Africa. Her partner, R, was a UK national. Between 2008 and 2010, B and R had resided together in South Africa. In May 2010, R had accepted employment in the Netherlands. He lived together with B in the Netherlands until 2013, where she obtained a residence card in her capacity as an ‘extended family member’ of a Union citizen. In 2013, B and R decided to move together to the UK. B’s application for a residence card was refused by the applicant Secretary of State for the Home Department on the ground that she was the unmarried partner of R and that reg 9 of the Immigration (European Economic Area) Regulations 2006, SI 2006/1003 (the Regulations) provided that only the spouse or civil partner of a UK national could be considered a family member of that national.

B’s appeal against that decision was allowed by the First-tier Tribunal (Immigration and Asylum Chamber)(UK). The Secretary of State was subsequently granted permission to appeal against that decision to the Upper Tribunal (Immigration and Asylum Chamber)(UK)(the referring tribunal) on the ground that there had been an error of law. The referring tribunal found, first, that the only material difference between B’s case and R v Immigration Appeal Tribunal and Surinder Singh, ex p Secretary of State for the Home Department: C-370/90 [1992] 3 All ER 798(Singh) was that B was the unmarried partner of a Union citizen, whereas in the former case Mr and Mrs Singh had been married. The principles developed by the Court of Justice (the Court) in that judgment could, therefore, be applied to the present case. Second, the referring tribunal noted that a differently constituted chamber of that tribunal had already held that a person who had been refused a residence card as an ‘extended family member’ had no right of appeal under the Regulations.

In those circumstances, the referring tribunal stayed the proceedings and referred certain questions to the Court for a preliminary ruling.

Issues and decisions

Whether art 21(1) of the Treaty on the Functioning of the European Union (TFEU) should be interpreted as requiring the member state of which a Union citizen was a national to grant or facilitate the provision of a residence authorisation to the partner with whom that Union citizen had not contracted a registered partnership (the unregistered partner), a third-country national with whom the Union citizen had a durable relationship that was duly attested, where the Union citizen, having exercised his right of freedom of movement to work in a second member state, in accordance with the conditions laid down in Directive (EC) 2004/38, returned with his partner to the member state of which he was a national in order to reside there.

Pursuant to art 21(1) TFEU, ‘every citizen of the Union shall have the right to move and reside freely within the territory of the Member States, subject to the limitations and conditions laid down in the Treaties and by the measures adopted to give them effect.’ Article 3(1) of Directive 2004/38 provided that that directive was to apply to all Union citizens who moved to or resided in a member state other than that of which they were a national, and to their family members as defined in art 2(2) of that directive who accompanied or joined them (see [20]-[22] of the judgment).

 Point (b) of the first sub-paragraph of art 3(2) of Directive 2004/38 related specifically to the partner with whom the Union citizen had a durable relationship that was duly attested.  According to the Court’s caselaw, art 3(2) of Directive 2004/38 did not require the member states to accord a right of entry and residence to third-country nationals envisaged in that provision, but imposed an obligation on those member states to confer a certain advantage on applications submitted by the third-country nationals envisaged in that article, compared with applications for entry and residence of other nationals of third countries (see [23], [30] of that judgment).

In the present case, it followed that although B could come within the concept of ‘partner with whom the Union citizen has a durable relationship, duly attested’, in point (b) of the first subparagraph of art 3(2) of Directive 2004/38, that directive could not, however, confer a right on B for her application for residence authorisation to be facilitated by the UK. However, the Court had acknowledged, in certain cases, that third-country nationals, family members of a Union citizen, who were not eligible on the basis of Directive 2004/38 for a derived right of residence in the member state of which that citizen was a national, could, nevertheless, be accorded such a right on the basis of 21(1) TFEU. That consideration was based upon settled caselaw, according to which, in essence, if no such derived right of residence were granted to such a third-country national, a Union citizen would be discouraged from leaving the member state of which he was a national in order to exercise his right of residence under art 21(1) TFEU in another member state because he was uncertain whether he would e able to continue in his member state of origin a family life which had been created or strengthened, with that third-country national, in the host member state, during a genuine residence (see [26]-[28] of the judgment).

According to that caselaw, the conditions under which that derived right of residence could be granted should not, in principle, be stricter than those provided for by Directive 2004/38 for the grant of such a right of residence to a third-country national who was a family member of a Union citizen in a case where that citizen had exercised his right of freedom of movement by becoming established in a member state other than that of which he was a national. Even though Directive 2004/38 did not cover the return of that Union citizen to the member state of which he was a national in order to reside there, it should be applied by analogy. That caselaw was equally applicable as regards the partner with whom the Union citizen had a durable relationship that was duly attested, within the meaning of point (b) of the first subparagraph of art 3(2) of Directive 2004/38 (see [29], [32] of the judgment).

In a situation such as that in question in the main proceedings, Directive 2004/38, including point (b) of the first sub-paragraph of art 3(2) thereof, should be applied by analogy as regards the conditions in which the entry and residence of third-country nationals envisaged by that directive had to be facilitated (see [33] of the judgment).

R v Immigration Appeal Tribunal and Surinder Singh, ex p Secretary of State for the Home Department: C-370/90 [1992] 3 All ER 798 considered; Secretary of State for the Home Department v Rahman [2012] All ER (D) 48 (Sep) considered; O v Minister voor Immigratie, Integratie en Asiel: C-456/12 [2014] All ER (EC) 843 considered; Coman and others v Inspectoratul General pentru Imigrari and another [2018] All ER (D) 20 (Jun) considered.

(2) Whether art 21(1) TFEU should be interpreted as meaning that a decision to refuse a residence authorisation to the third-country national and unregistered partner of a Union citizen, where that Union citizen, having exercised his right of freedom of movement to work in a second member state, in accordance with the conditions laid down in Directive 2004/38, returned with his partner to the member state of which he was a national in order to reside there, had to be founded on an extensive examination of the applicant’s personal circumstances and be justified by reasons.

 Pursuant to art 3(2) of Directive 2004/38, applicable by analogy to a case of return such as that at issue in the main proceedings, member states were under an obligation to confer a certain advantage on applications submitted by the third‑country nationals envisaged in that article, compared with applications for entry and residence of other nationals of third countries. The Court had held that, in order to meet that obligation, member states should, in accordance with the second sub-paragraph of art 3(2) of Directive 2004/38, make it possible for persons envisaged in the first sub-paragraph of art 3(2) of that directive to obtain a decision on their application that was founded on an extensive examination of their personal circumstances and, in the event of refusal, was justified by reasons (see [37], [38] of the judgment).

When undertaking that examination of the applicant’s personal circumstances, it was incumbent upon the competent authority to take account of the various factors that could be relevant in the particular case. In the light both of the absence of more specific rules in Directive 2004/38 and of the use of the words ‘in accordance with its national legislation’ in art 3(2) of that directive, each member state had a wide discretion as regards the selection of the factors to be taken into account. Nonetheless, member states had to ensure that their legislation contained criteria which were consistent with the normal meaning of the term ‘facilitate’ and which did not deprive that provision of its effectiveness (see [39], [40] of the judgment).

(3) Whether art 3(2) of Directive 2004/38 should be interpreted as meaning that third-country nationals envisaged in that provision had to have available to them a redress procedure whereby matters of both fact and law could be reviewed by the court, in order to dispute a decision to refuse a residence authorisation taken against them.

According to the Court’s caselaw, member states should, in accordance with the second sub-paragraph of art 3(2) of Directive 2004/38, make it possible for persons envisaged in the first sub-paragraph of art 3(2) of that directive to obtain a decision on their application that was founded on an extensive examination of their personal circumstances and, in the event of refusal, was justified by reasons. Since the provisions of Directive 2004/38 had to be interpreted in a manner which complied with the requirements flowing from art 47 of the Charter of Fundamental Rights of the European Union, those persons should have available to them an effective judicial remedy against a decision, under that provision, permitting a review of the legality of that decision as regards matters of both fact and law in the light of EU law (see [47] [48] of the judgment).

Consequently, the procedural safeguards provided for in art 31(1) of Directive 2004/38 were applicable to the persons envisaged in point (b) of the first subparagraph of art 3(2) of that directive. The national court should be able to ascertain whether the refusal decision was based on a sufficiently solid factual basis and whether the procedural safeguards had been complied with. Those safeguards included the obligation for the competent national authorities to undertake an extensive examination of the applicant’s personal circumstances and to justify any denial of entry or residence (see [49], [52] of the judgment).

Preliminary ruling determined.

Neneh Munu Barrister

Article 21(1) of the Treaty on the Functioning of the European Union should be interpreted as requiring the member state of which a Union citizen was a national to facilitate the provision of a residence authorisation to the unregistered partner, a third-country national with whom that Union citizen had a durable relationship that was duly attested, where the Union citizen, having exercised his right of freedom of movement to work in a second member state, in accordance with the conditions laid down in Directive (EC) 2004/38, returned with his partner to the member state of which he was a national in order to reside there. The Court of Justice so held in a preliminary ruling in proceedings concerning the refusal by the applicant Secretary of State for the Home Department (UK) to issue the respondent, a third-country national, with a residence card after she had moved to the UK with her unmarried partner who was a UK national.

Legislation

Section 43 of the Value Added Tax Act 1994 (VATA 1994), so far as material, provided that: ‘(1) Where under sections 43A to 43D any bodies corporate are treated as members of a group, any business carried on by a member of the group shall be treated as carried on by the representative member, and (a) any supply of goods or services by a member of the group to another member of the group shall be disregarded; and (b) any supply which is a supply to which paragraph (a) above does not apply and is a supply of goods or services by or to a member of the group shall be treated as a supply by or to the representative member; and all members of the group shall be liable jointly and severally for any VAT due from the representative member.’

Background

The proceedings concerned whether claims for the return of overpaid VAT were to be treated as having been made by, or on behalf of, a single taxable person, for the purposes of  VATA 1994 s 43.

Between 1973 and 2009, the respondent taxpayer, Taylor Clark Leisure plc (TCL), was the representative member of the Taylor Clark VAT group (the VAT group). In about 1990, TCL transferred its bingo business to Carlton Clubs Ltd (Carlton), a member of the VAT group. In 1998, Carlton ceased to be part of the VAT group.

It had been wrongly assumed that income generated from bingo and gaming machines was to be treated as subject to VAT at the standard rate. However, in February 2005, the Court of Justice of the European Union (the CJEU) ruled that such income was exempt from VAT. Subsequently, the appellant Revenue and Customs Commissioners (HMRC) invited claims for the repayment of VAT on income from gaming machines and analogous activities.

In 2008, the then House of Lords held that UK legislation, which imposed a shortened three-year time limit on claims for the refund of overpaid VAT between 1973 and 1996, without providing for an adequate transitional period that was fixed in advance, was contrary to European law. In response, Parliament enacted s 121 of the Finance Act 2008 (FA 2008), which disapplied the three-year time limit on claims to be made for over-declared or overpaid VAT in respect of periods up to 4 December 1996, if a claim was made before 1 April 2009.

In November 2007, Carlton submitted four claims to HMRC under VATA 1994 s 80, for the repayment of VAT output tax which TCL, as representative member of the VAT group, had accounted for in the years between 1973 and 1998. TCL contended that, as the representative member of the VAT group, it had been entitled to rely on Carlton’s claims, because they were to be regarded as having been submitted on behalf of the VAT group, which EU law treated as a single taxable person entitled to repayment of the unduly levied tax.

Carlton submitted a revised claim (iv), asserting a right to claim overpaid VAT back to 1973. It relied on an agreement made in 1990 (the 1990 asset transfer agreement), which it claimed had assigned to it the right to make historic claims. In May 2009, HMRC paid the sum which Carlton had claimed in its revised claim (iv) (£667,069) to TCL, as representative member of the VAT group.

In September 2010, HMRC reversed its earlier decision concerning claim (iv) by confirming its assessments which sought the repayment of the £667,069 and interest. HMRC also refused TCL’s claim for repayment of the other claims Carlton had submitted. HMRC’s reasons were that: (i) TCL had not submitted claims before the expiry of the time limit imposed by FA 2008 s 121; (ii) the claims pre-dating 31 March 1990 had been assigned to Carlton by the 1990 asset transfer agreement; and (iii) because the VAT group had since been disbanded, the claim for over-declared output tax had to be made by the company whose activities had given rise to the over-declaration and Carlton had made that claim.

TCL and Carlton pursued rival appeals against HMRC’s refusal to replay the outstanding claims. The First-tier Tribunal (Tax Chamber) held, first, that the right to claim repayment of sums due from 1973 to 1990 had been assigned to Carlton by the 1990 asset transfer agreement (the assignation issue). Second, that the right to repayment for the claims relating to the period from 1990 to 1996 had been re-invested in Carlton when it had left the VAT group in 1998 (the entitlement issue). Third, that TCL had not made a claim under VATA 1994 s 80 and could not rely on the claims submitted by Carlton, which had not made the claims on TCL’s behalf (the claimant issue).

The Upper Tribunal (Tax and Chancery Chamber) (UT) dismissed TCL’s appeal. On the claimant issue, it held that VATA 1994 s 80 required that the claim be made by, or on behalf of, the taxpayer seeking repayment; TCL had not made a claim and no claim had been made on its behalf before the end of the limitation period; accordingly TCL’s claim was time-barred. On the assignation issue, in reversing the FTT’s decision, the UT held that TCL had not assigned the pre-1990 claims to Carlton in the 1990 asset transfer agreement. On the entitlement issue, it was recorded that it was common ground between HMRC and TCL that TCL was the appropriate party to seek repayment of tax accounted for between 1990 and 1996, even after the VAT group had been disbanded on 28 February 2009.

The Extra Division of the Inner House allowed TCL’s appeal, holding that the representative member embodied the VAT group which was a single taxable person, so that the acts, rights, powers and liabilities of the individual members of the group were ascribed to the representative member as far as they related to VAT. The Inner House ruled that, in the context of VATA 1994 s 43, a claim by an individual member of a VAT group had to normally be construed as a claim made on behalf of the representative member embodying the group, as otherwise the claims would have no meaning. As a result, by adopting a purposive construction of the letters which Carlton had sent to HMRC, Carlton’s claims fell to be regarded as claims made by TCL as representative member of the VAT group.

HMRC appealed to the Supreme Court.

Appeal allowed.

Issues and decisions

(1) Whether TCL was to be treated as having made claims for repayment of overpaid VAT within the time limit set by FA 2008 s 121, namely by 31 March 2009, in circumstances where Carlton, a former  member of the VAT group, and not TCL, had made the relevant claims.

HMRC submitted that the Inner House had erred in holding that a claim for repayment of VAT by an individual member of a VAT group had to normally be construed as a claim made on behalf of the representative member of that group. HMRC further contended that Carlton’s claims had been made on its own behalf and TCL could not rely on them to avoid the statutory time bar.

TCL submitted that Carlton’s claims had sought to vindicate the rights of the single taxable person, which was the VAT group. The court considered art 11 of Council Directive (EEC) 2006/112 (the Directive).

Article 11 of the Directive was permissive. First, there was no obligation on a member state to institute such a regime. Second, it was not prescriptive and did not lay down a template as to how a member state would treat a group of persons as a single taxable person (see [19] of the judgment).

It was clear from the statutory words in VATA 1994 s 43(1) that the UK had chosen to achieve the end which the Directive authorised, not by deeming the group to be a quasi-person, but by treating the representative member as the person which supplied or received the supply of goods or services (see [21] of the judgment).

In the UK, the single taxable person, for which provision was made in art 4.4 of the Directive, was the representative member (see [22] of the judgment).

There was no need to complicate matters by introducing a concept of the VAT group as a quasi-persona in an analysis of the UK legislation (see [26] of the judgment).

VATA 1994 s 43 did not make the group a taxable person, but treated the group’s supplies and liabilities as those of the representative member for the time being (see [27] of the judgment).

It was clear from the words of VATA 1994 s 80(1) that HMRC’s liability to credit or repay the overpaid output tax was owed to the person who had accounted to them for VAT in the relevant accounting period or periods. It was also clear from the concluding words in sub-s (2) (‘for the purpose’) that a claim had to be made for the credit or repayment to that person before HMRC come under any liability to credit or repay. It followed from the operation of VATA 1994 s 43 that, where there had been overpayments of VAT by the representative member of a VAT group, the person entitled to submit a claim during the currency of a VAT group, unless the claim had been assigned, was either the current representative member of the VAT group or a person acting as agent of that representative member (see [29] of the judgment).

Applying settled law to the facts, the FTT had not erred in law in holding that it was clear from the text of each of Carlton’s letters that it was claiming, in its own right, repayment of sums alleged to have been overpaid by way of VAT, and that Carlton had not made the claims in 2007 and the revised claim in 2009 on behalf of TCL (see [34]-[36] of the judgment).

In so far as there was any doubt as to the basis on which Carlton was making the claims in the four letters of 16 November 2007, the clarification provided by the latter letter was admissible and relevant evidence of the nature of Carlton’s claims. To hold otherwise, and have regard to the letter of 9 January 2009 only to the extent that it revised the earlier claim, would  be wholly artificial (see [37] of the judgment).

TCL’s case of agency could not get off the ground. Carlton had had no actual authority to send the letters on TCL’s behalf. The FTT’s findings of fact, which were not challenged, destroyed any such assertion. Further, as an appeal from the UT to the Inner House or to the present court was available only on a point of law arising from the decision of the UT, it was not open to the appellate courts to find that there was an agency relationship between Carlton and TCL (see [38], [39] of the judgment).

Keighley, Maxsted & Co v Durant [1900-3] All ER Rep 40 considered; Customs and Excise Comrs v Thorn Materials Supply Ltd and Thorn Resources Ltd [1998] 3 All ER 342 considered; Finanzamt Gladbeck v Edith Linneweber: C-453/02; Finanzamt Herne-West v Savvas Akritidis: C-462/02 [2005] All ER (D) 254 (Feb) considered; Fleming (t/a Bodycraft) v Revenue and Customs Comrs; Condé Nast publications Ltd v Revenue and Customs Comrs [2008] All ER (D) 151 (Jan) considered; Commissioners for Her Majesty’s Revenue and Customs v Rank Group plc: C-259/10 and C-260/10 [2011] All ER (D) 95 (Nov) considered; Standard Chartered plc TC3450 [2014] UKFTT 316 (TC) approved.

(2) Whether, as TCL contended, a reference should be made to the CJEU under art 267 of the Treaty on the Functioning of the European Union, concerning whether the interpretation of VATA 1994 s 43 which the court favoured was compatible with the concept of the single taxable person in art 11 of the Directive.

It was neither necessary, nor appropriate, to make a reference because a ruling by the CJEU on the nature of the single taxable person was not necessary for the determination of the present appeal (see [41] of the judgment).

CILFIT Srl and Lanificio di Gavardo v Ministry of Health: C-283/81 [1982] ECR 3415 considered.

Decision ofthe Extra Division of the Inner House, Court of Session [2016] STC 2492 Reversed.

Andrew Young QC, David Thomson QC (instructed by Office of Advocate General) for HMRC.

Philip Simpson QC, David Scorey QC (instructed by KPMG LLP) for TCL.

Carla Dougan-Bacchus Barrister.

It was clear from s 80(1) of the Value Added Tax Act 1994 that the Revenue and Customs Commissioners’ liability to credit or repay overpaid output tax was owed to the person who had accounted to them for VAT in the relevant accounting period or periods. Further, it followed from the operation of s 43 of that Act that, where there had been overpayments of VAT by the representative member of a VAT group, the person entitled to submit a claim during the currency of a VAT group (unless the claim had been assigned) was either the current representative member of the VAT group, or a person acting as agent of that representative. Accordingly, the Supreme Court, in allowing the Revenue and Customs Commissioners’ appeal, ruled that the respondent taxpayer (TCL), the representative member of the Taylor Clark VAT group, was not to be treated as having made claims for repayment of overpaid VAT within the time limit set by s 121 of the Finance Act 2008, in circumstances where another company, which was a former member of the VAT group, and not TCL, had made the relevant claims. The court rejected TCL’s contention that the claims in question had been made by, or on behalf of, the single taxable person, namely the VAT group.